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1 SECTION / ARTICLE BRIGHT IDEAS FOR A BRIGHT FUT URE THE 2015 OPTUS SUSTAINABILITY REPORT for n o w I l l s e t l e f o r i c e c r e a m
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BRIGHT IDEAS FOR A BRIGHT FUTURE - Optus · BRIGHT IDEAS FOR A BRIGHT FUTURE ... and long-term growth for our business, while leading and shaping positive change for our marketplace

Jun 19, 2020

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  • 1SECTION / ARTICLE

    BRIGHT IDEAS FOR A BRIGHT FUTURETHE 2015 OPTUS SUSTAINABILITY REPORT

    for now I’ll set le for ice cream

  • 32 SECTION / ARTICLESECTION / ARTICLE

    TABLE OF CONTENTS ABOUT THIS REPORTTHIS IS OUR 16TH ANNUAL REPORT ON THE SUSTAINABILITY PERFORMANCE OF SINGTEL OPTUS PTY LTD (OPTUS). THE REPORT COVERS OUR FINANCIAL YEAR 1 APRIL 2014 TO 31 MARCH 2015.

    This report and previous years’ sustainability report can be found at www.optus.com.au/about/sustainability/reports

    Offshore ventures, franchised retail outlets and subsidiaries are not included in this report unless otherwise stated. This report has been prepared ‘in accordance’ with the Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines - Core option. The GRI Content Index can be found on pages 80-82.

    We use the London Benchmarking Group (LBG) methodology to measure and report on our contribution to the community. This year we sought external limited assurance under ISAE3000 for selected indicators in the report. The scope and basis for the assurance is provided in the Assurance Statement at the end of the report.

    Ere-S Pte Ltd provided the assurance as part of a wider engagement with Singtel, which provided assurance over the Singtel Sustainability Report. This helps to facilitate a consistent approach to sustainability assurance across the Group.

    All information contained in the report was correct as at 18 June 2015.

    Our approach to sustainability, this report, and previous years’ reports can be found at www.optus.com.au/about/sustainability

    Singtel has produced its first Singtel Group Sustainability Report which can be accessed online at www.info.singtel.com/sustainabilityreport2015

    We welcome your feedback or questions in relation to this report. Please contact sustainability@optus.com.au

    The best bits of 2015 4

    A message from our Chairman and CEO 6

    About Us 9

    Sustainability at Optus 10

    Marketplace & Customers 20

    Our Community 36

    Our People 50

    Environment 60

    The progress we’ve made 72

    Memberships and industry initiatives we support 74

    Assurance statement 76

    GRI Index 80

    http://www.optus.com.au/about/sustainability/reportshttp://www.optus.com.au/about/sustainabilityhttp://info.singtel.com/sustainabilityreport2015

  • 54 HIGHLIGHTS 2015HIGHLIGHTS 2015

    THE BEST BITS OF 2015 HIGHLIGHTS

    MARKETPLACE AND CUSTOMERS

    COMMUNITY

    PEOPLE

    ENVIRONMENT

    of Australian population covered by our 3G network and 86% of the Australian Population covered by our superfast

    4G Plus network.

    98.5%

    We remain the only Tier 1 Telco in positive NPS (+4)

    NPS +4

    connecting regional customers and remote sites

    New satellite

    OPTUS 10 LAUNCHED

    Further widened sustainability considerations in our updated

    Vendor Code of Conduct

    Number of 4G mobile subscribers increased by

    64.2% to a total of 3.52 million customers

    64.2%

    into the community

    through our mobile student2student program with The Smith Family

    students attended a Digital Thumbprint workshop with 95%

    of students confirming they learnt something in the workshop they can

    use in their everyday life.

    37,821

    through various Australian Business Community Network (ABCN) programs, including work place visits and

    interview skills workshops.

    students across 146 schools as part of the Kids Helpline @ School program

    since its inception in June 2013.

    11,207

    People engagement increased to 75% and People NPS also up

    75%

    Overall health & wellbeing score improved by

    20.9%

    Introduced a comprehensive mental health strategy

    Our training programs were recognised externally by

    winning 2 industry awards

    The Australian Business Roundtable for Disaster Resilience and Safer

    Communities, of which we are a founding member, was awarded the certificate of

    distinction in the prestigious 2015 United Nations Sasakawa Awards for

    Risk Reduction

    Invested into the upgrade of 560 key mobile sites with smarter meters to

    provide greater visibility and control of our energy

    consumption.

    In our mobile network we’ve reduced our energy intensity per Terabyte even though mobile data use (“traffic”) on our networks has continued to increase substantially year on year.

    94% OF STUDENTS IMPROVED THEIR LITERACY LEVELS

    MENTORED 769 VULNERABLE YOUTH

    510 volunteer roles

    We’ve reached

    $8.7MInvested

  • 76 CEO’S MESSAGECHAIRMAN’S MESSAGE

    CHAIRMAN’S MESSAGE CEO’S MESSAGE

    I AM VERY PLEASED TO PRESENT OPTUS’ 2015 SUSTAINABILITY REPORT; MY FIRST ONE AS CHAIRMAN AFTER OVERSEEING 10 PREVIOUS SUSTAINABILITY REPORTS AS CEO.

    This year was all about offering more ‘yes’ to our customers and leading the charge on our ambition to become Australia’s most loved and recommended service brand. This is part of our commitment to creating sustainable and long-term growth for our business, while leading and shaping positive change for our marketplace & customers, the communities we operate in, our people and the environment.

    Throughout the year, Optus continued to enhance the competitiveness of its network – with A$1.4 billion in capital expenditure and complementary spectrum investments of more than A$720 million. At the end of April 2015, Optus’ 4G network reached 86% of the Australian population. This is a huge step and means more Australians are enjoying a superfast data experience.

    This year we also launched Australia’s latest state-of-the-art satellite, 29 years after we propelled our first satellite into orbit. As the only local company to own and operate satellites, Optus is the leading provider of satellite services across Australia and New Zealand. Australian customers in rural and remote areas will be the first to benefit from the launch of Optus 10.

    Optus has always been about choice and competition - it’s been our mantra for the past 20 years since we started as a business. Part of my role as Optus’ chairman is to spend more time working with Governments on our plans for the National Broadband Network (NBN) and continue advocating for a more competitive market.

    I’m pleased to say that in December 2014, we achieved an important new agreement with the nbn™ which will accelerate the rollout of the NBN so Australians can connect sooner, reduce the overall cost of building the NBN and put us a step closer to creating a level playing field in the market.

    Under the new arrangements, Optus will sell its high fibre coaxial cable assets to nbn™, while retaining ownership of strategic assets like the aerial fibre which connects our mobile base stations and enterprise customers. Importantly this will free up capital so that we can invest in new technology which is critical to embark on our strategy to deliver disruptive products and innovation to more consumers.

    Through the natural disasters that have hit Australia over the past few years, we have seen what a difference the resilience and reliability of our network can make to the communities we operate in. In this regard, Optus, together with six other major Australian corporations through the “Australian Business Roundtable for Disasters and Safer Communities” have played a leading role in discussions with the government on adapting critical infrastructure to climate change and building greater community resilience.

    Our vision is to continue to be a company that not just challenges the competition, but one that shapes the market with new technologies and innovative products, backed by brilliant service and a reliable, safe network.

    We’ll continue to be restlessly optimistic and we’re ready to play to win and help all Australians Live More Yes.

    Paul O’Sullivan Chairman

    I AM THRILLED TO BE BACK IN OPTUS AND AUSTRALIA, HAVING STUDIED HERE AND WORKED WITH VARIOUS PARTS OF THE BUSINESS FOR MANY YEARS, MOST RECENTLY AS MANAGING DIRECTOR OF OPTUS CONSUMER.

    When I returned to Australia in October 2014, I promised to focus on three areas to keep building on what we’ve achieved in our business over the last 2 years - continue to invest in a network that keeps up with Australian’s data hungry habits, give customers something more - enhancing their experiences in ways that matter the most to them and help them live more yes and to make Optus the best and most fun place to work in Australia.

    To achieve these goals, we’ve listened to what is important to our stakeholders in order to prioritise how we serve our customers, communities, people and the environment. The issues that are of material importance to our stakeholders as well as to us as a business form the basis of this report.

    For our customers, we’re constantly innovating to meet their changing needs. They want simple products and they want value. We want to make a difference to our customers’ lives by engaging, enhancing and entertaining them.

    Examples of our innovation include the introduction of Cash by Optus, a contactless payment app for smartphones and wearable devices that replaces cash purchases below $100. This is a first for Australian telcos and showcases ingenuity and innovation that Optus is known for. We’ve also made the Netflix interface available through Fetch TV, introduced plans that allow the sharing of data across multiple devices as well as with the entire family, and transformed nearly 100 stores to service our customers better.

    Customers are noticing the difference and so are we - we remain the only Tier 1 telco with a positive Net Promoter Score (NPS).

    We don’t just use our expertise in technology and innovation to serve our customers alone; we also use it to serve our communities. We focus our work around helping vulnerable young people achieve, thrive and belong and assist them in being responsible and savvy digital citizens.

    Our focus on material issues goes beyond just our immediate operations but into our extended value and supply chain. We’ve undertaken a review of our supply chain risks and this year will focus on updating our supplier engagement and reviews on issues such as work health and safety, customer data protection and privacy, in particular where we’ve overseas outsource operations in our contact and IT development centres.

    I am also absolutely committed to making Optus the best and most fun place to work in Australia. This year I’m delighted that our employee engagement measured through Your Voice has increased to 75% with improvements in several categories including our areas of customer focus, competition and leadership. This reflects the belief in our culture and our brand, as well as what we’re doing for customers and communities. We ‘ve worked to strengthen our diversity & inclusion efforts, with a focus on developing successful women in leadership through various mentoring, coaching, networking and other leadership development opportunities for our female talent across all levels of the organization.

    I would like to take this opportunity to celebrate the positive impact that we’ve had on our stakeholders. I’m excited about the year ahead as we continue to build this brand and keep Optus a great place to work.

    Allen Lew CEO

  • 98 SECTION / ARTICLE ABOUT US

    ABOUT US

    WE’RE AUSTRALIA’S SECOND-LARGEST TELCO WITH OVER 9,000 EMPLOYEES AND 346 YES OPTUS SHOPS.

    We help more than ten million customers each day and we’re also the only carrier in Australia to own and operate three types of network infrastructure - mobile, fixed and satellite.

    We help businesses and people communicate anytime and in many ways - making communications easier, faster, more economical and reliable. This is helped by breaking the barriers of distance, price, time and technology and by building strong bonds among us, with our shareholders, customers and business partners.

    We’ve been a wholly owned subsidiary of Singtel since 2001. We were originally listed on the Australian Stock Exchange (ASX) on 10 September, 2001 with Singtel announcing our delisting from the ASX on 22 April, 2015. The delisting took effect on 5 June, 2015. Singtel

    continues to be listed on the Singapore Exchange Securities Trading Limited (SGX) and the delisting from the ASX will not materially affect Singtel’s compliance obligations or corporate governance policies and practices. The wider Singtel Group helps over 550 million customers around the world and is a major communications player throughout Asia and Africa.

    OUR AMBITIONOur vision is to lead Australia in outstanding customer experience and become the most loved and recommended service brand in Australia. We’re guided by five values - Customer Focus, Challenger Spirit, Teamwork, Integrity, and Personal Excellence.

    We own and operate our network infrastructure which we wholesale to other providers. We also use the services of other providers to connect our customers. We’ve around 6,000

    3G mobile base stations that provide coverage of 98.5% of the Australian population. We’ve more recently switched on 4G to over 3,200 base stations across our network providing 4G coverage to 86% of the Australian population.

    We provide customers with a range of services including:

    • Mobile

    • Fixed and IP telephony• Business network services • Fixed and wireless broadband • Satellite services • Entertainment and subscription TV.

    We also deliver wholesale services to third parties for resale under their own brand. Our retail products and services are sold to customers via phone, internet or through our retail outlets.

    Our head office is located at 1 Lyonpark Rd, Macquarie Park, NSW 2113.

    hi

    Group Consumer – this combines the Group’s consumer-related functions, including our international business in the emerging markets which leverages our mobile customer base of more than 500 million for optimised outcomes.

    Group Digital Life - drives the Group’s efforts to be at the forefront of the digital space. It focuses on creating new avenues and revenue platforms for the Group. Key focus areas include premium over-the-top video, digital marketing and advanced analytics.

    Group Enterprise - delivers innovative and comprehensive ICT solutions to the Group’s enterprise customers across geographical boundaries. Both Singtel and Optus deliver satellite services, international data and managed services, cloud computing and enterprise mobility services.

    WE’RE ARRANGED INTO 3 MAIN BUSINESS AREAS WHICH SERVE DIFFERENT MARKETS

  • 1110 ABOUT US / OBJECTIVES AND PILLARSABOUT US / FINANCIAL RESULTS & WHAT SUSTAINABILITY MEANS TO US

    DRIVING SUSTAINABILITY

    We’re continually working to deeply embed sustainability in our culture, values, decision-making, products and services to create a business that’s positioned for long-term growth. We do this by leveraging the power of communications, infotainment and our people to transform lives and make a positive impact on our society.

    We focus on areas we feel are important to both us and our key stakeholders. We’ve got an opportunity

    For the financial year ended 31 March, 2015, we delivered strong full year revenue and EBITDA growth, underpinned by the improved performance of our mobile operations.

    Operating revenue was up 4% to A$8.79 billion. EBITDA grew 5% to A$2.62 billion, while annual net profit grew 1% to A$841 million. Underlying net profit grew 4% year-on-year to A$873 million. EBITDA margin improved 0.4 percentage points to 29.9%.

    Free cash flow for the full year was up 8% to A$976 million.

    We became a member of the United Nations (UN) Global Compact this year. Our areas of focus support the 10 Principles of the UN Global Compact and we’ll continue to align our priorities with the development of the UN’s Impact 2030 Sustainability Development Goals into the future.

    to take a leadership role and using our skills, resources and expertise can make a positive difference on current and future generations.

    We’re leading and shaping positive change in four key areas, which we call our sustainability “pillars”: Marketplace and Customers, Community, our People and the Environment.

    WHAT SUSTAINABILITY MEANS TO US

    FINANCIAL RESULTS

    TO CREATE SUSTAINABILITY AND LONG-TERM GROWTH FOR OUR BUSINESS, WHILE LEADING AND SHAPING THE POSITIVE CHANGE FOR OUR MARKETPLACE & CUSTOMER,

    THE COMMUNITIES WE OPERATE IN, OUR PEOPLE AND THE ENVIRONMENT:

    WE AIM TO DEEPLY EMBED SUSTAINABILITY IN OUR DNA, CULTURE, VALUE SYSTEM AND THE WAY WE RUN OUR BUSINESS AND ENGAGE

    OUR STAKEHOLDERS

    • Delivering superior customer experience and transforming the way our customers live and work with our innovative ICT products and services

    • Adhering to the highest standards of corporate governance

    • Embracing responsible business practice

    • Driving positive and sustainable changes to disadvantaged communities, especially vulnerable youth

    • Enabling the inclusion and well-being of young people and the broader community

    • Engaging our people to support the community through corporate workplace giving and volunteer programs

    • To be an employee our people are proud to work for by providing care and equal opportunities in workplace and culture that diverse, inclusive and collaborative

    • Challenging and developing our people to reach their fullest potential

    • Through understanding our impacts, we’re committed to minimising our environmental footprint across our value chain.

    • We will achieve this by delivering on our 4 strategic pillars: addressing climate change, integrating the environment agenda into our value chain, engaging our stakeholders and product & resource responsibility

    MARKETPLACE AND CUSTOMERS

    COMMUNITY

    OPTUS CORPORATE

    SUSTAINABILITY FRAMEWORK

    PEOPLE ENVIRONMENT

    2015 2014

    ECONOMIC VALUE GENERATED A$m A$m

    Revenue 8,790 8,466

    ECONOMIC VALUE DISTRIBUTED

    Operating costs (excluding staff costs) 5,002 4,851

    Staff costs 1,246 1,171

    Dividends to shareholders 560 560

    Tax expense 360 361

    Community investments 9 10

    ECONOMIC VALUE RETAINED 1,613 1,513

  • 1312 ABOUTS US / SUSTAINABILITY GOVERNANCEABOUTS US / SUSTAINABILITY GOVERNANCE

    GOVERNANCE STRUCTUREWe take our compliance standards seriously. For example, our senior leaders and people must complete mandatory compliance modules such as Fraud Awareness and Fraud Risk Indicators, Information Security, Equal Opportunity Employment, Conflict of Interest Declaration each year.

    But we think it’s important to do more than just comply – we want to challenge the status quo, show leadership and continually strive to reduce our negative impact and contribute positively to society.

    Strategic oversight for sustainability is led by Singtel’s Group Management Committee with Singtel Group CSR overseeing the formulation, recommendation, coordination, execution and reporting of the Group’s sustainability strategy.

    Our Corporate Responsibility Steering Committee provides guidance on the local execution of the Group’s sustainability strategy, delivering on our commitment to the four focus areas of Marketplace & Customers, Community, People and Environment with a specific focus on our material aspects.

    WE BELIEVE GOOD GOVERNANCE IS NOT JUST ABOUT MAKING ‘CORRECT’ DECISIONS AND IMPLEMENTING THEM, BUT ABOUT HAVING THE BEST PROCESSES IN PLACE FOR MAKING THOSE DECISIONS.

    Over the years, we’ve developed a robust set of well-defined corporate governance processes to improve our corporate performance and accountability. Our values guide our actions to help deliver more ‘yes’ for our customers: Customer Focus, Challenger Spirit, Teamwork, Integrity and Personal Excellence. They’re embodied in our Code of Conduct which drives us to conduct our business in an ethical manner whenever we deal with customers, suppliers, competitors and the community.

    SUSTAINABILITY GOVERNANCE

    SUSTAINABILITY GOVERNANCE STRUCTURE

    BOARD OF DIRECTORS

    MANAGEMENT COMMITTEE(Formulating sustainability strategy)

    GROUP CSR(Managing sustainability

    throughout the Singtel Group)

    CSR WORKING GROUP

    SINGTEL OPTUS ASSOCIATES Singapore Australia

    REGIONAL GROUP CSR

    A Platform for the various working groups to collaborate and share best practices on CSR programmes

    Developing and implementing sustainability and programmes

    BUSINESS AND SUPPORT UNITSWorks closely with

  • 1514 ABOUTS US / LEARNING FROM LISTENING TO OUR STAKEHOLDERSABOUTS US / LEARNING FROM LISTENING TO OUR STAKEHOLDERS

    manage any potential risks to our business, continue to make a positive contribution to the community and importantly, identify future industry trends so that we can innovate products and services, stay ahead of our competitors and offer more ‘Yes’ to our customers.

    The table on the next page of our stakeholder groups, our engagement activities and how we’re responding to stakeholder interests.

    This year we also undertook a targeted survey of our stakeholders to understand their views on our current and future sustainability reporting.

    We asked them who had read the 2014 Sustainability Report, what they

    LISTENING TO OUR STAKEHOLDERS HELPS US IDENTIFY KEY ISSUES, RISKS AND OPPORTUNITIES WHICH ARE IMPORTANT TO THEM AND ALSO TO OUR LONG TERM SUSTAINABILITY.

    Our key stakeholder groups include customers, shareholders, employees, local communities, charity partners, industry associations, Government and regulators, and suppliers.

    Significant for two main reasons, they’re impacted by our operations, products and services and their actions can also affect our ability to successfully implement our strategies and achieve our objectives. As such, we engage with them regularly to understand their interests and concerns so we can work to meet their expectations,

    TO OUR STAKEHOLDERSLEARNING FROM LISTENING

    HOW WE ENGAGE OUR STAKEHOLDERS

    CUSTOMERS • Easier and simpler products• Better service• Pricing• Better network speeds and

    coverage where you need it

    • Market NPS• Touch point NPS to capture feedback

    from interactions such as Optus Shops, Care and Digital

    Ongoing

    SHAREHOLDERS 1 • Financial and operational performance

    • Strategy• Performance of various

    business units

    • One-on-one meetings• Investor conferences and roadshows• Conference calls• Email communications

    Quarterly and as required

    EMPLOYEES • Rewards and incentives• Customer Service• Culture• Wellbeing• Diversity & Inclusion• Learning & development• Our work with communities

    • Employee roadshows• Internal intranet• Staff newsletters• Emails• People NPS Quarterly• Annual Engagement Survey

    – “Your Voice”

    Quarterly, annually and as required

    LOCAL COMMUNITIES • Visual impacts• Property values • Perceived adverse health

    and safety impacts of electromagnetic energy (EME)

    • Network outages• Impact of natural disasters on

    network services

    • Letter box drops• Local newspaper articles• Community consultative sessions or

    community drop in sessions• Briefing with local councils and

    councillors• Briefing Members of Parliament• Web based consultation updates

    As required

    CHARITY PARTNERS AND COMMUNITY ORGANISATIONS

    • Safe & secure digital online practices

    • Community access to services• Reducing environmental impact • Social impact measurement

    • Face-to-face meetings• Workshops• Online surveys• This year we conducted a specific

    online survey to help us identify our material sustainability issues and also to obtain feedback on the information and presentation of our 2014 Sustainability Report

    Depending on partner – from weekly to monthly

    INDUSTRY ASSOCIATIONS

    • Varies depending on industry topic and focus of information.

    • See section at back of report for a list of Optus’ industry association memberships and other initiatives we support

    • We are a member of a number of industry associations and engage in the development of self- regulatory codes and policy positions on a range of topics related to our industry (e.g. NBN, spectrum, copyright, marketing, privacy, environment, health and safety, packaging and reporting frameworks)

    As required

    GOVERNMENT AN REGULATORS

    • We engage with all levels of government across Australia

    • Participation in consultation papers As required

    SUPPLIERS • Corporate governance• Occupational health and safety• Environmental management• Product stewardship • Supplier management

    • We have a supplier assessment that outlines governance and environmental issues.

    • Over the coming year, a more complete supplier self-assessment that will be implemented.

    • Audits of suppliers as required in areas of Optus sustainability material issues

    As required

    STAKEHOLDER ISSUES OF INTEREST ENGAGEMENT MECHANISM FREQUENCY

    read, their views on report content, what was and wasn’t useful in the last report, how they want sustainability information delivered (i.e. soft copy, online, hard copy report) and which topics we should act and report on in the future.

    This vital feedback has been incorporated into this year’s report. For example we’ve structured the report to provide summary information and performance highlights at the front for readers with limited time, we’ve added more background information about the sustainability issues faced by us, more case studies to update readers on community initiatives, more balanced disclosure of our positive and negative impacts and we’ve sought external assurance.

    1. Optus is a wholly-owned subsidiary of Singtel. “Shareholders” here refers to the shareholders of the broader Singtel Group, which is listed on the SGX.

  • 1716 ABOUT US / FOCUSING ON WHAT MATTERS MOSTABOUT US / FOCUSING ON WHAT MATTERS MOST

    OUR BUSINESS MODEL AND STRATEGY FOCUSSES ON THE AREAS THAT PRESENT OPPORTUNITIES FOR US TO DIFFERENTIATE OURSELVES AND CREATE SUSTAINABLE AND LONG TERM GROWTH FOR OUR BUSINESS.

    Underpinning this however, is the need to manage and mitigate risks to reduce the uncertainty associated with the execution of our business strategies, and allow us to maximise the opportunities that may arise.

    Risks take on many forms and can have material adverse impacts on our ability to achieve our stated objectives by potentially impacting our reputation, operations, human resources and financial performance.

    Whilst we’re committed to delivering value to our shareholders through

    sustained profitable growth, we won’t compromise our integrity, values and reputation by risking brand damage, service delivery standards, severe network disruption or regulatory non-compliance.

    As a signatory of the United Nations Global Compact, we’ll also uphold the ten principles covering human rights, labour practices, environment and anti-corruption.

    This year we undertook a comprehensive materiality assessment to identify issues and other relevant topics considered important for reflecting our economic, environmental and social impacts and/or influencing the views of our key stakeholders.

    We prioritised our material issues using the process depicted in this diagram.

    FOCUSING ON WHAT MATTERS MOST

    INTERNAL BUSINESS PERSPECTIVE

    OPTUS’ APPROACH TO IDENTIFYING MATERIAL ISSUES

    Develop short-list of 25 issues based on results of analysis

    Rate significance of top 25 issues based on

    results of analysis

    Management workshop to rate the significance

    of 25 issues based on the business

    Establish universe of potential environmental, social and economic issues using the GRI G4 issue indicators

    Confirm the top material issues for inclusion in sustainability report across the Group, Singapore and Australia based on combination of

    external and internal ratings

    Material issues mapped against the key business value chains, for granular impact and risk assessment

    Consider both “internal business perspective” and “external stakeholder perspective” from a combination of information sources

    (outlined on the following pages)

    EXTERNAL STAKEHOLDER PERSPECTIVE

    MA

    TER

    IALI

    TY

    ASS

    ESS

    MEN

    T P

    RO

    CE

    SS

  • 1918 ABOUT US / MATERIALITY ISSUESABOUT US / MATERIALITY ISSUES

    MATERIALITY ISSUES MATRIX FOR OPTUSIMPACT TO THE OPTUS BUSINESS (OPTUS INTERNAL PERSPECTIVE) VS. INFLUENCE ON EXTERNAL STAKEHOLDERS (EXTERNAL PERSPECTIVE)

    TOP MATERIAL ISSUES:

    • Customer satisfaction• Product quality • Innovation• Customer data privacy and protection• Customer health and safety• Fair marketing communications• Regulatory compliance• Supply chain management• Cyber wellness and online safety• Inclusion of vulnerable groups• Talent attraction and retention• Employee health and safety• Climate change and energy

    management

    OPTUS MATERIAL ISSUE GRI G4 MATERIAL ASPECTS & BOUNDARY BOUNDARY REPORT CHAPTER

    CUSTOMER SATISFACTION Product & service labelling – PR5 External (customers) Marketplace & Customer

    PRODUCT QUALITY /

    REGULATORY COMPLIANCECompliance – PR9

    Internal & External

    (customers, Government

    and regulators)

    Marketplace & Customer

    INNOVATION Indirect economic Impacts - EC7External (customers, local

    communities)Marketplace & Customer

    CONSUMER DATA AND PRIVACY Customer Privacy– PR8Internal & External

    (customers, regulators)Marketplace & Customer

    CUSTOMER HEALTH & SAFETY Customer Health and Safety – PR2External (customer, local

    communities, regulators)Marketplace & Customer

    FAIR MARKETING COMMUNICATIONS Marketing Communications – PR7External (customer,

    regulators)Marketplace & Customer

    SUPPLY CHAIN MANAGEMENT Supplier human rights assessment) – HR10 External (suppliers Marketplace & Customer

    CYBER WELLNESS AND ONLINE SAFETY Local Communities– SO2External (local communities,

    charity partners)Community

    INCLUSION OF VULNERABLE GROUPS

    Economic performance– EC1

    Indirect economic impacts – EC8

    Internal & External (local

    communities, charity

    partners)

    Community

    TALENT ATTRACTION AND RETENTION Employment – LA1

    Training & Education – LA9Internal People

    EMPLOYEE HEALTH & SAFETY Occupational Health & Safety– LA6 Internal People

    CLIMATE CHANGE AND ENERGY MANAGEMENTEnergy– EN3

    Greenhouse gas emissions – EN15 & 16

    Internal & External (local

    communities, charity

    partners)

    Environment

    We considered external stakeholder perspectives and internal business perspectives to develop a long list of relevant topics, established and applied a rating criteria to determine the top 25 issues most important to both viewpoints and then conducted a workshop to shortlist the top material issues considered to be most significant to us.

    The workshop then confirmed the top material issues for us for inclusion in this report. A similar material issues identification process was carried out for Singtel and the Singtel Group.

    The diagram below shows how we priorities our material issues.

    * All the external impacts are deemed to be within Australia except for supply chain and the environment, where the impacts are global. As per the Sustainable Supply Chain section , we are currently undertaking a review of our Vendor Code of Conduct and an environmental lifecycle analysis to determine where our supply chain and environmental impacts are.

    The top material issues provided the starting point for informing the content of this year’s report. We then validated these areas by cross checking them with the significant issues that arose across the business and in the media during the reporting period. This was to make sure our report provided a balanced representation of our sustainability performance for the year.

    We then mapped the top material issues against their corresponding GRI material aspects, which can be shown in the table on the next page

    For each material aspect, we also show their boundaries, i.e. where the impact of the aspect lies (internal or external to Optus). Finally, the table also references the chapters of this report where the discussion of the material issues can be found.

    Influence on internal stakeholders (Internal perspective)

    OUR MATERIAL ISSUES

  • 2120 SECTION / ARTICLE MARKETPLACE & CUSTOMERS / HIGHLIGHTS

    MARKETPLACE & CUSTOMERS

    We remain the only Tier 1 Telco in positive NPS (+4)

    NPS +4

    connecting regional customers and remote sites

    New satellite

    OPTUS 10 LAUNCHED

    Further widened sustainability considerations in our updated

    Vendor Code of Conduct

    Number of 4G mobile subscribers increased by

    64.2% to a total of 3.52 million customers

    64.2%of Australian population covered by our 3G network and 86% of the Australian Population covered by our superfast

    4G Plus network.

    98.5%

  • 2322 MARKETPLACE & CUSTOMERS / CUSTOMER EXPERIENCEMARKETPLACE & CUSTOMERS / CUSTOMER EXPERIENCE

    WE WANT TO PROVIDE SIMPLE PRODUCTS, BRILLIANT SERVICE AND A GREAT NETWORK FOR OUR CUSTOMERS. THIS IS UNDERPINNED BY A COMMITMENT TO INNOVATION, PRODUCT QUALITY AND CUSTOMER SATISFACTION.

    We’re making significant changes to put customers at the heart of everything we do. We continue to invest in upgrading, modernising and equipping our systems with new capabilities to ensure we continue to deliver innovative and relevant services to our customers.

    We’ve made good improvements.

    Our Net Promoter Score (NPS) results indicate that we’re the only tier one telco with a positive NPS. This is a great result but we think can do more to achieve our ambition of being Australia’s most loved and recommended service brand.

    Competitive pressure in mobile continues to increase, so it’s critical we continue to improve our services, innovate with our products and plans and improve network performance to differentiate ourselves from our competitors.

    IMPROVING CUSTOMERS’ LIVES THROUGH IMAGINATION AND INNOVATIONOur capacity to improve the lives of our customers through imagination and innovation is what will set us apart from competitors. This year, we’ve offered new products, plans and competitive prices to keep providing value to customers and to attract new ones. Some of the great things we’ve been up to include:

    • Introducing My Plan Plus which gives customers the power to share their data across multiple devices. We launched our key switch offer, timed with the launch of the new iPhone, to help people get out of their mobile contract early to upgrade to a new phone.

    We also offered to pay for customers who terminate contracts with our competitors to switch to us. The percentage of postpaid customers on a tiered data plan has increased over the past 12 months, reflecting the success of our innovative My Plan Plus postpaid product.

    • We transformed our Yes Optus shops with a new ‘Generation 6’ design. It reflects the flow of our customers’ journey giving them an easy and intuitive path through the store. We also boosted the number of people in store to welcome customers and offer each one a personalised service to help make their purchasing decisions easier.

    Our alluring new store designs scored us a Gold Award at the recent POPAI awards for retail marketing. POPAI is the global industry association for shopper marketing and marketing retail recognising creativity, innovation and inspiration.

    We won two other awards-Best Interior Design-Retail and Best Branded Experience-Marketing at the Sydney Design Awards.

    • Making your watch and smartphone even smarter by launching Cash by Optus, a mobile payment app that replaces cash purchases below $100. This is a first for Australian telcos and showcases the ingenuity and innovation that we’ve known for. Cash by Optus uses Near Field Communication (NFC) and Visa payWave technology that allows our customers to pay for those small everyday purchases like lunch, petrol and groceries using a smartphone instead of a plastic debit or credit card. Cash by Optus can also be used for online purchases up to $250.00 in a single click up to.

    • We’ve struck a deal with Netflix so that for a period of time all our fixedhome broadband customers can enjoy watching Netflix without having to worry that their Netflix viewing will push them over their data limit. Also for the first 3 months following the launch of Netflix in Australia, we’ve been giving away up to 6 months subscriptions to Netflix for new and re-contracting customers on certain broadband, postpaid mobile and prepaid mobile PLANS. We’re the first Telco in Australia to do this!

    ALL ABOUT CUSTOMER EXPERIENCE

    Regional Store Ballarat

  • 2524 MARKETPLACE & CUSTOMERS / CUSTOMER EXPERIENCEMARKETPLACE & CUSTOMERS / CUSTOMER EXPERIENCE

    DATA HUNGRY HABITS WE KNOW AUSSIES LOVE DATA – WE’RE DOWNLOADING MORE, USING OUR APPS MORE, AND WATCHING MORE VIDEO, ON THE GO.

    In the 2014 financial year, Australians each used around 2GB of data per month. By 2019, we expect Australians will each use around 10GB per month. That’s a five-fold increase in five years. Today 38% of Australian households have four or more internet-connected devices. That is predicted to double by 2020 with Australians connecting six or more devices to the internet.

    With more people using smartphones, customers have an increased appetite for data. And when data usage goes up, it exposes people to unexpectedly high bills or ‘bill shock’. This can lead to negative experiences and financial hardship for our customers.

    We’ve done a lot of work to help prevent bill shock – hardship services, customers alerts, roaming packs – which have significantly reduced the number of customers experiencing an unusually high spend.

    We’ll continue to keep working to explain how much data customers use so they can get the most out of their plans and also look for new opportunities to provide a differentiated digital experience for our customers and communities.

    JOINING FORCES WITH WESTFIELD TO MEET GROWING SHOPPER DEMANDS FOR DATA. With over 500 million visits to Westfield shopping centres in 2014 and shoppers increasingly using their smartphones to inform their shopping trip and connect socially, the demand for data is growing rapidly.

    We recently joined forces with Westfield to offer shoppers a new level of digital connectivity with the rollout of a managed WiFi solution to over 21 Westfield shopping centres. The service provides shoppers with up to 1GB of data free for a 3 hour period each day and will be accessible across the entire common mall area.

    “Working with such a reputable technology provider as Optus will provide benefits for our shoppers and our business…This service will strengthen the appeal of our assets with our local communities” Peter Allen, Scentre Group CEO

    “We’re two well-respected Australian brands working together to deliver innovative technology and customer experience initiatives – it’s very exciting!” - John Paitaridis, Managing Director, Optus Business

    WE LOOK TO LESS OBVIOUS PLACES TO ENSURE THAT WE’RE

    PROVIDING A SUPERIOR CUSTOMER EXPERIENCE

    ACROSS THE BOARD.

    BACKED BY BRILLIANT SERVICE To make it easier online and to provide a customer service experience that’s better than ever – in store, online or over the phone – we continued to work hard and solve customer’s problems the first time they contact us.

    We’ve done a lot of work around identifying customer frustrations by analysing call volumes by call type, listening to call recordings, and analysing customer feedback. The result was a program of diverse initiatives that had the common goal of reducing customer effort. This program positively impacted more than 3.6 million customers and resulted in an average of 45% less calls from customers who no longer need to wait in a phone queue to speak to a Customer Service Agent to process their request. This also translates into increased profitability for us in terms of improved efficiency and ability to redistribute work effort to other areas within Optus.

    Our hard work to improve the customer journey has won us a national award the 2014 Customer Service Institute of Australia (CSIA) National Customer Service Project of the Year.

    It doesn’t stop there. Our ‘Bringing back the love’ initiative saw our promoter response team proactively call back customers who had disappointing experiences with us to address their concerns and encourage their ongoing loyalty.

    We’ve done a lot of work to improve our online help and support. We provided new functionality into Optus My Account that empowers our customers to resolve issues by themselves. We’ve improved My Optus Community by launching a fancy new mobile enabled version allowing customers to ask questions and seeking out answers about our range of products and services whether they’re at home or on the go.

    We also launched the free MyOptus App which provides an easy way for customers to manage their prepaid mobile or prepaid mobile broadband account on the go. They can keep track of their calls, text and data usage; recharge their credit and lots more anytime, anywhere.

    We look to less obvious places to ensure that we’re providing a superior customer experience across the board. For example, the passing of a loved one can be a difficult time so we’ve made changes to help close or transfer their Optus accounts possible through the creation of a specialist Bereavement Care team.

    This team have made major improvements to the way we handle deceased estates; our communications, timeframe and processes. Instead of taking over three months to resolve a case, we’re now doing it in under 5 days in most cases, with all marketing materials and bill communication suspended, any early termination or cancellation fees waivered and the final balance zeroed out.

  • 2726 MARKETPLACE & CUSTOMERS / CUSTOMER EXPERIENCEMARKETPLACE & CUSTOMERS / CUSTOMER EXPERIENCE

    4G across Australia. At the end of Q3, complaints to the TIO were the lowest out of all the Teir 1 telcos.

    However, in Q4, there has been a spike in complaints, mostly due to customers taking advantage of the faster 4G network and downloading greater content which has led to customers using excess data. We are, however, working hard to address “bill shock” through greater customer alerts (see previous feature on ‘Data Hungry Habits’).

    UNDERPINNED BY A GREAT NETWORK During the FY15 year, we invested $1.4 billion in our networks.

    We made a significant investment in the mobile network this year to upgrade sites with new 4G 700MHz spectrum - which was officially released on 1 January 2015. A key benefit of 700MHz is that it provides improved indoor coverage, which means more 4G whether at home or in the office. The 700MHz spectrum also heralded the expansion of our 4G network into Regional Australia, bringing Optus 4G to hundreds of regional and holiday towns for the first time. To mark the step change in 4G coverage and quality for customers, we evolved our ‘4G Plus’ brand to encompass our entire 4G network.

    Customers continue to upgrade to the latest 4G-compatible devices, like the iPhone 6 and Samsung Galaxy S6, to make the most of our 4G Plus network wherever it expands. As at end of April 2015, our 4G Plus network covers 86% of the Australian population. 4G is live on 3,383 mobile sites, of which 2,107 have been upgraded to the 700 MHz spectrum. We’ll keep investing to expand our superfast 4G Plus network to more Aussies in more places, to support our strategy to deliver a great mobile network and high definition television to customers when they want, on the device they want.”

    We’ll keep investing to expand our superfast 4G Plus network to more Aussies in more places, to support our strategy to deliver a great mobile network and high definition television to customers when they want, on the device they want.

    We launched the Optus 10 Satellite. Australian customers in rural and remote areas will be the first to benefit. Optus 10 is now providing backhaul and connection services for regional and remote sites across our mobile network.

    This year we reached an agreement with nbn™ in December on the migration of our HFC customers to the NBN. This is a significant milestone – allowing us to deliver greater choice and innovation to more consumers by opening up the broadband market in parts of Australia where we haven’t had either ADSL or cable network before.

    This agreement gives us capital to invest in new technology which is critical as we embark on our strategy of delivering disruptive products and services that will excite our customers and allows us to differentiate itself from competitors.

    “Optus has been a vocal advocate for fixed line competition for many years. The NBN offers the potential to provide more choice and competition for all Australians and puts us a step closer to creating a level playing field in Australia’s retail broadband market. Anything that speeds up the rollout of the NBN and increases the size of the contestable national broadband market is good for innovation and competition” - Allen Lew, CEO

    Competition in technology matters because it drives efficiency and innovation. It drives lower prices, transparency and choice, but also upgraded and new technologies and new services.

    What’s vital as we reinvent our economy over the next decade is how we use disruptive technologies like analytics and cloud computing. High-speed 4G mobile networks and the NBN will accelerate disruption, but they will also offer new opportunities – enabling Australia to finally overcome the tyranny of distance.

    These opportunities will only come if we have highly efficient, intelligent and low-cost telecommunications services.

    We say Yes to competition and Yes to an Australia that stays at the forefront of Communications technology.

    YES TO BETTER RESULTSEvery quarter we ask consumers and our people how likely they are to recommend us to family and friends.

    After our highest NPS score of +6 in Q2, we ended the financial year at +4, the only Tier 1 telco with a positive score.

    In the first three quarters, we saw a dramatic decrease in complaints to the Telecommunication Industry Ombudsman (TIO), largely due My Plan Plus significantly reducing Excess Data complaints. We also saw a significant reduction in coverage complaints due to rollout of 4G and the next gen of version

    Optus hosts the World Mobile Congress

  • 2928 MARKETPLACE & CUSTOMERS / RESPONSIBLE PRODUCTS & SERVICESMARKETPLACE & CUSTOMERS / RESPONSIBLE PRODUCTS & SERVICES

    RESPONSIBLE PRODUCTS & SERVICES

    “OUR SERVICES ARE CRITICAL IN DISASTER RESPONSE, AND

    WE DELIVER THEM ACROSS INFRASTRUCTURE THAT MUST BE HIGHLY RESILIENT AGAINST THE IMPACT OF NATURAL DISASTERS”

    WE’RE PROVIDING OUR CUSTOMERS WITH RESPONSIBLE PRODUCTS AND SERVICES WITH A FOCUS ON SAFETY, PRIVACY AND FAIR MARKETING PRACTICES.

    We’re in the business of enhancing the lives of our customers and the community through our technology and products. The innovation seen over recent years, particularly the internet, has given us access to information, culture, communication and entertainment impossible to imagine just 20 years ago.

    But despite the opportunities of a connected and digital world (e.g. social media, online shopping, banking) there are a few downsides – the visual and perceived health impacts of our infrastructure and mobile towers which are in the back yards of communities all over Australia and the rise of digital security, privacy and data protection issues.

    We continue to adapt and evolve our business and processes to keep on top of these issues. We take our responsibility seriously and know that to be a sustainable company we need to earn the trust of our customers, people and communities.

    YES TO SAFE AND RELIABLE NETWORKS We’re all about giving our customers a great network experience. That’s why we’re expanding our coverage and making our network more reliable. That includes doing everything from building new towers to installing the latest and greatest technology - and adding extra capacity so our network can handle more people using it at the same time.

    While Australian’s want to enjoy superfast mobile internet in more metropolitan, regional and holiday areas, they don’t always support the infrastructure being in their neighbourhood. Communities can be concerned about visual impact, property values and perceived adverse health and safety impacts of electromagnetic energy (EME).

    Most of our activity over the last three years has focussed on upgrading existing sites with equipment such as antennas, electronics or

    mechanisms to connect to the base station. Under the Federal Legislation in which we operate, this work is largely considered ‘low impact’ and generally doesn’t require formal planning approvals.

    We have a dedicated team which has worked successfully with hundreds of communities around Australia to inform them of our upgrade works and ensure they’re happy with what we’re doing. We also have interactive coverage maps on our website so that both customers and communities can check their location for planned upgrades, maintenance and live outages.

    - PAUL O’SULLIVAN CHAIRMAN

    ELECTROMAGNETIC ENERGY (EME)A NUMBER OF HEALTH CONCERNS HAVE BEEN RAISED GLOBALLY ON POTENTIAL EXPOSURE TO ELECTROMAGNETIC ENERGY (EME) EMISSIONS THROUGH USING MOBILES OR BEING EXPOSED TO MOBILE NETWORK INFRASTRUCTURE SUCH AS BASE STATIONS.

    While there is no substantiated evidence of public health risks from exposure to the levels of EME typically emitted from mobile phones, perceived health risks can be a concern for our customers, the community and regulators.

    We regularly assess the health and safety impacts of our products and services.

    We design and deploy our network to comply with the relevant Federal Government mandated Standards for exposure to EME. These Standards are formulated and regularly reviewed by the Australian Radiation Protection and Nuclear Safety Agency (ARPANSA). ARPANSA is part of the Commonwealth Department of Health. ARPANSA’s Standards are based upon those recommended by the International Commission on Non-Ionizing Radiation Protection (ICNRP), which is a related agency of the World Health Organisation (WHO).

    The ICNRP Standards are adopted by many countries around the world and are considered best practice. We conduct audits of base stations and undertake predictive EME modelling and testing to ensure compliance at our sites with Australian Standards. All of our sites have EME reports available to the public at www.rfnsa.com.au

    We continue to monitor research findings on electromagnetic energy health risks and their implications on relevant standards and regulations in Australia and the rest of the world.

  • 3130 MARKETPLACE & CUSTOMERS / RESPONSIBLE PRODUCTS AND SERVICESMARKETPLACE & CUSTOMERS / RESPONSIBLE PRODUCTS AND SERVICES

    FAIR MARKETING We advertise and market our products and services widely across Australia so it’s important that the information represented is accurately stated otherwise it risks misleading customers and breaching fair marketing legislation.

    We make every reasonable endeavour to ensure that our advertising and promotional materials comply with Australian legislation. Our employees undertake online compliance training annually. Employees that deal directly with our competitors have additional training on anti-competitive conduct.

    Our approach goes beyond customer data protection and is designed to ensure continued engagement to encourage customers to deepen their trust in us. We know that privacy is important to our customers and we strive to be open and transparent in how we serve them.

    Optus has in place security mechanisms such as firewalls and encryption algorithms designed to minimise the risk of privacy breaches. We also implement and test antivirus or intrusion prevention systems, based on established security standards.

    We also have established an escalation process for major incidents, which includes security breaches, to ensure timely response, internally and where necessary externally, to minimise impact.

    Optus reported 3 data privacy incidents in 2014 to the Office of the Australian Information Commissioner (OAIC), including what it did to address both the specific incidents as well as improve its overall processes. On 26 March 2015, Optus committed to continuous improvement through offering an enforceable undertaking to the OAIC.

    To minimise disruptions for our customers, we schedule upgrade work in stages. Customers are notified prior to any network improvements through text message and community service announcements in the local paper.

    We experienced minor service disruptions to our mobile sites in South Australia, Western Australia and Victoria in early 2015 due to bushfires and in parts of Queensland due to power failures associated with the impacts of Cyclone Ita in April 2014 and Cyclone Marcia in February 2015.

    On all occasions, our network teams worked to make sure our customers could be connected to their loved ones and emergency services.

    CUSTOMER & DATA PRIVACY We strive to conduct our business in full compliance with local laws and regulations, and hence implemented additional measures to protect our customers’ personal information. These include:

    • Safeguards to prevent security breaches in our networks and database systems

    • Limits on access to information in our systems and the systems of our business partners and vendors

    • Strict verification processes to guard against unauthorised access to information

  • 3332 MARKETPLACE & CUSTOMERS / SUSTAINABLE SUPPLY CHAINMARKETPLACE & CUSTOMERS / SUSTAINABLE SUPPLY CHAIN

    WE’RE ALWAYS LOOKING FOR SUPPLIERS WHO SHARE OUR APPROACH TO RESPONSIBLE BUSINESS PRACTICES. WE PRIORITISE SUPPLIERS WHO MET, OR ARE WORKING TO MEET, THE ‘OPTUS VENDOR CODE OF CONDUCT’ AND OUR FUTURE FOCUS IS ON ASSESSMENT AND GOVERNANCE.

    With Singtel we’ve relied on and will continue to rely on around 6000 third party vendors for various purposes, for example the construction of

    SUSTAINABLE SUPPLY CHAINthe Group’s network, the supply of handsets and equipment, systems and applications development and services, content provision and customer acquisition.

    In 2014, the Singtel and Optus procurement teams began working towards a one procurement framework. Through this journey sustainable supply chain management was identified as a key focus and built into the group strategy.

    We also worked together on articulating a refreshed management approach. While we’ve recently done a comprehensive stakeholder engagement and materiality review, we’re still early in the journey of an extensive supply chain management for sustainability risk issues.

    Our management approach draws from the high risk areas highlighted in our materiality review, spend, geographies, compliance with focus outside of the

    high tier vendors that already have established processes. The key for Singtel is to identify where the material risks are in the supply chain and to deep dive through collaboration with our suppliers to ensure that we work on minimising material risk.

    In the last half year we have revisited our supply chain risks through different filters such as the type of vendors and spend categories, country risk profiles as well as materiality risks such as the environment, labour, data protection and so on.

    As such there are a number of potential environment, social and community issues in our supply chain, particularly in our two most significant areas: offshoring and ICT. We’ve chosen to focus our initial supply chain reviews in our offshore outsourced centres as these are an extension of our work force, and are also a major part of our vendor spend and business dependency. While many of the global handset, IT and network equipment vendors like Apple, Samsung, Cisco and Ericsson comprise material spend and dependency in our supply chain, these are also global companies with their own established supply chain practices and reputation to protect.

    In addition, the telco industry is dominated by a handful of key suppliers for equipment and services so if they fail to deliver then they can significantly affect our business and our promise to our customers.

    SUSTAINABLE SUPPLY CHAIN MANAGEMENT (SSCM)The potential for business and sustainability related issues to arise in our supply chain was identified as a material issue for us in our FY15 materiality review.

    As such, we’ve initiated an internal work group to review our current procurement policies and practices to identify areas where we need to further enhance and embed sustainability considerations. This work is being done for both Singtel and Optus.

    SUPPLIER CODE OF CONDUCT &

    SELF-ASSESMENT

    TOP VENDORS BY SPEND AND

    CATEGORIES

    Review completed in Singtel and

    Optus in FY2015

    HIGH RISK GEOGRAPHIES

    Commenced scoping with Optus Customer

    Ops and GIT

    INITIAL PRIORITY FOCUS

    Updated code approved by GCPO

    for implemented in FY2016

    NETWORK DELIVERY AND

    FIELD OPERATIONS VENDORS

    OFFSHORE OUTSOURCED VENDORS

    • IT development and support

    • Contact Centres & BPO

    HIGHER REGULATORY COMPLIANCE

    TOP MATERIALITY ISSUES RELEVANT TO

    SUPPLY CHAIN

    SUSTAINABLE SUPPLY CHAIN MANAGEMENT Framework, Decision Criteria and Filters

  • 3534 MARKETPLACE & CUSTOMERS / LOOKING AHEADMARKETPLACE & CUSTOMERS / SUSTAINABLE SUPPLY CHAIN

    It requires potential suppliers to disclose whether they comply with International Labour Organisation (ILO) standards and provide information about their policy and/or management system in relation to their working conditions, anti-discrimination, occupational health and safety (OH&S) and governance processes.

    We’ve undertaken a major review of both the Optus and Singtel Vendor Codes of Conduct and prepared a new draft Vendor Code of Conduct which is centred on a materiality approach and includes our commitment to the principles of the UN Global Compact. While we haven’t screened any new suppliers using human rights criteria this financial year, we’ve prepared a new supplier assessment which will be used next year to review our higher risk suppliers.

    LOOKING AHEAD FOR MARKETPLACE AND CUSTOMERS

    DEVELOPING LARGER FLAGSHIP YES OPTUS SHOPS which allow customers to touch and play with our products

    IMPLEMENT THE NEW SUSTAINABLE SUPPLY CHAIN FRAMEWORK, WHICH INCLUDES:

    75% (spend) of suppliers will be assessed against key material issues

    100% of new contracts will have the Supplier Code of Conduct applied

    Assurance review of relevant offshore/outsource suppliers

    APPOINT A DEDICATED PRIVACY EXECUTIVE to oversee the strategy, policy and compliance relating to customer data privacy and protection in our operations and supply chain

    REINFORCE THE IMPORTANCE OF INFORMATION SECURITY AND PRIVACY at all levels in the organization and company retailers.

    CONTINUE TO DRIVE THE ACTION we need to take to lift Market NPS and increase our lead on our major competitors

    CONTINUING TO FOCUS ON SUPPORTING our frontline people and our people in the call centre

    CONTINUOUSLY LOOK FOR AND UNDERSTAND OUR CUSTOMER PAIN POINTS so we can address them and create tangible reasons for them to be our advocates

    UPDATE THE COMPANY DATA PRIVACY framework to meet evolving legislation and customer expectations; and ENSURE INFORMATION SECURITY AND PRIVACY COMPLIANCE in relevant areas of our supply chain.

    The ‘Optus Vendor Code of Conduct’ sets out our expectations of all vendors and highlights the minimum requirements that must be met. It covers five key areas:

    • Corporate governance• Occupational health and safety• Environmental management• Product stewardship • Supplier management

    It also sets out our expectations of how we manage our ongoing relationships with our vendors and the requirements for reporting on their activities and performance.

    In addition, we’ve already sent some of our suppliers specific information requirements in relation to environmental performance and labour practices to help us identify significant actual and potential negative impacts on society in the supply chain. As we progress in the implementation

    of our sustainability supply chain management system, we will refine this approach and integrate more systemic assessment mechanisms:

    Environmental Management System (EMS) Information about our EMS is sent out as required depending on the goods or services we’re purchasing. It sets out our environmental policy, the relevant environmental legislation that we must adhere to and provides guidance in relation to action plans that are consistent with our Optus’ EMS. The questionnaire enables us to assess whether the vendor is compliant or ‘needs improvement’ with respect to the management of environmental issues associated with their particular business activity.

    International Labour Questionnaire This questionnaire is specific to international suppliers and vendors who provide labour services to us.

    “Optus’ philosophy is that our supply chain relationships for sustainability issues should NOT be adversarial and confrontational. The reality is that you can’t simply turn on and off your suppliers. Also, if you simply cut ties and disengaged with them in event of supply chain issues, they would never have a model of best practice to improve their business practices. Bringing in higher standards in the supply chain is not an overnight process. They take time to embed, like they take time to embed in our own internal operations.”Andrew Buay – VP CSR and Talent

  • 3736 SECTION / ARTICLE OUR COMMUNITY / HIGHLIGHTS

    OUR COMMUNITY

    students attended a Digital Thumbprint workshop with 95% of students

    confirming they learnt something in the workshop they can use in their

    everyday life.

    37,821

    through our mobile student2student program with The Smith Family

    94% OF STUDENTS IMPROVED THEIR LITERACY LEVELS

    through various Australian Business Community Network (ABCN) programs, including workplacevisits and

    interview skills workshops.

    MENTORED 769 VULNERABLE YOUTH

    510 volunteer roles

    students across 146 schools as part of the Kids Helpline @ School program

    since its inception in June 2013.

    11,207 We’ve reached

    into the community$8.7M

    Invested

  • 3938 OUR COMMUNITY / THE OPTUS COMMUNITY FRAMEWORKOUR COMMUNITY

    We genuinely care about the impact of big societal issues our next generation face and believe we can play an active role in being part of the solution. Our people are designing and creating the technology, networks and products day in day out, so we’ve more knowledge and insight about these digital issues than most.

    We invest in community partnerships that enable us to leverage our collective knowledge, skills and resources; this leads to better reach and scalability of programs and ultimately greater success of programs. Our partnerships are founded on creating shared objectives, understanding who the stakeholders are, and achieving and measuring social outcomes not just inputs and working in a way that builds capacity of all stakeholders.

    ONE OF THE WAYS WE’RE BUILDING TRUST AND RELATIONSHIPS WITH ALL OF OUR STAKEHOLDERS IS BY SUPPORTING AND INVESTING IN THE COMMUNITY. OUR MISSION IS TO HELP VULNERABLE YOUTH ACHIEVE THEIR FULL POTENTIAL THROUGH TECHNOLOGY AND LIFE ENHANCING PROGRAMS

    We’ve been at the forefront of working with communities for over two decades and we continue to innovate and evolve our programs to bring about positive change and create real societal impact. Our community work is not just about doing good to enhance our reputation and goes beyond providing financial support.

    OPTUS COMMUNITY FRAMEWORKOur Community Framework has four key themes where we believe we can make the biggest difference, with a particular emphasis on vulnerable youth. They are areas which are strategically aligned to our core business and not only help to achieve our business objectives today but importantly, will help us build trust with our customers, people and communities in to the future.

    Our Community initiatives are particularly focused on supporting vulnerable youth. We focus on young people because our children and young people are ‘digital natives’ - they’ve grown up with the internet and are increasingly living their lives online. We want to equip our youth of today with the skills to be safe and savvy digital citizens. Young people may also be vulnerable to issues which we can help with by supporting them to achieve (education and employability), thrive (digital citizenship) and belong (wellbeing and inclusion).

    “For more than 20 years we’ve said yes to ideas that make positive changes to people’s lives. We’re excited about how technology can improve young people’s future. We want to back our young people to develop ideas that help solve some of the major social issues their generation are facing such as cyber safety and bullying.” - Helen Maisano, Associate Director CSR Optus.

    KEY CSR FOCUS: VULNERABLE YOUTH

    • Bringing Education through technology to disadvantaged and vulnerable youth

    • Helping young people with future career options through mentoring and transition to employment

    • Mobile student2student

    • Community Grants

    • ABCN

    • Cyber-safety solutions for youth

    • Empowering young people to be responsible and savvy digital citizens

    • Digital Thumbprint

    • Kids Helpline @ school

    • Improved employment prospects for disadvantaged youth and minority groups

    • Accessibility for remote and disadvantaged youth

    • Mental wellbeing and health

    • ABCN/work experience

    • Community Grants• Tour de Cure• Nelune Foundation• Kids Helpline @

    school

    • Developing a motivated and highly engaged workforce

    • Enabling our people to contribute to causes they are passionate about

    • Leveraging our people’s skills and expertise to build NFP/NGO capacity

    • yes4Good• A BCN mentoring• Skilled volunteering• Disaster response

    ACHIEVE: ACCESSIBILITY: & EDUCATION FOR ALL

    THRIVE: DIGITAL CITIZENSHIP BELONG: INCLUSION & WELLBEING

    ENGAGING OUR PEOPLE

    TO BE AUSTRALIA’S MOST LOVED AND RECOMMENDED SERVICE BRAND BY OUR PEOPLE AND OUR CUSTOMERS

    4 KEY THEMES

    EDUCATION AND EMPLOYMENT

    DIGITAL CITIZENSHIP

    ENGAGING OUR PEOPLE

    INCLUSION AND WELLBEING

    THE OPTUS COMMUNITY FRAMEWORK

  • 4140 OUR COMMUNITY / EDUCATION AND EMPLOYMENTOUR COMMUNITY / EDUCATION AND EMPLOYMENT

    EXPANDING OPPORTUNITIES FOR ABCN STUDENTSWe co-founded the Australian Business Community Network (ABCN) in 2005 to provide structured mentoring programs for students in areas of high need by partnering them with business professionals. Today, the membership has grown with 35 member companies and an experienced body of CEOs from well-recognised, national and global organisations.

    This year we continued to focus on supporting these vulnerable young people through Career Choice Day

    84% of students reported ‘yes’ when asked if the mobile student2student program has helped them feel better about themselves.

    “I got a lot more confident on the phone which helped me speak louder”. - Student Reader

    Over the next year, we aim to reach 700 disadvantaged student readers across Australia through the mobile student2student program. Enhancing literacy skills in our children is critical to helping them thrive personally and professionally in the future. Using our technology and resources is a simple and effective way to achieve this goal.

    One of our ABCN volunteers mentoring a studentEDUCATION AND EMPLOYMENTREADING BUDDIES The Optus and Smith Family mobile student2student program, aims to improve reading capability and confidence in disadvantaged and vulnerable students. The program identifies students in Years 3 to 8 who are approximately 2 years behind the national reading average. These students are connected with slightly older students called “Buddies” and together they spend 20-30 minutes a few times a week reading over the phone.

    In 2010, we approached The Smith Family with the innovative idea of trialing a mobile phone model of the landline version of student2student program in selected rural and regional households. This had the added advantage of catering to increasing numbers of families who do not have a landline in their homes. We supplied a mobile phone handset to each student Reader and their reading Buddy as well as donating all the call credits they needed to complete the program.

    The trial was a great success and became a national literacy program in 2013. Reading pairs almost doubled to 500 across all states and territories – a great increase from just 262 pairs in 2011.

    “Without question, the data shows that the program succeeded due to the generosity of OPTUS who provided the mobile phones and phone credit to facilitate the talk time for reading. 72% of parents say their child could not have otherwise participated.” - The Smith Family, 2014 Evaluation Report

    In 2014 with our ongoing support, funding and technical expertise, over 60% of the original program has now transitioned to the mobile phone model.

    At the completion of the 2014 mobile student2student program, 94% of students improved their literacy levels, 62% improved their reading age by up to a year and 38% showed reading age increases of more than a year. This is also reflected in the students’ perceptions of their own reading ability, with 90% agreeing their reading has improved since participating in the mobile student2student program.

    Improving reading skills increases a struggling reader’s confidence and motivation to read, which in turn helps support a positive reading habit, contributes to ongoing improvement and drives a shift in self-perception.

    and Interview Skills Workshops. Participants from high-needs schools are often limited in their access to work opportunities, access to role models and experiences that will develop their skills. We targeted Year 10 and 11 students who are beginning to consider career options for the future and the relevant study pathways required, to help broaden their awareness of vocational choices and equip them with tools for an interview situation.

    We had incredible participation from our people with approximately 510

    volunteer roles filled by our people mentoring 769 students.

    In addition, we were thrilled to launch our own yes4Good ABCN scholarship fully funded by our people. Paul O’Sullivan, our Chairman, is the representative on ABCN Scholarship Board and helped the panel select 14 scholarship winners.

    Our plan with ABCN is a long term one. If we can support these students in their development and career options today, then hopefully we can ‘close the loop’ and offer them employment in the future.

    - Mobile student2student buddy

    “THE LAST DAY I CALLED MY STUDENT READER TOLD ME HIS TEACHERS HAD NOTICED IMPROVEMENTS IN HIS READING. THIS MADE ME FEEL SO PROUD AND EVEN A LITTLE BIT TEARY”

  • 4342 OUR COMMIUNITY / DIGITAL CITIZENSHIPOUR COMMIUNITY / DIGITAL CITIZENSHIP

    IN 2014 ABCN WORKED WITH PARTNER ORGANISATIONS IN WESTERN SYDNEY AND MELBOURNE ON A SKILLS DEVELOPMENT AND MENTORSHIP PROGRAM, INROADS.

    The program was targeted at young unemployed graphic designers and ran from July through to November 2014. InRoads centred on a community project and immersed young unemployed graphic designers in the retail and cultural realities of re-branding various retail outlets on a ‘challenged’ street, while they were mentored by the program’s professional design and skills development mentors. Participants were matched to, trained and mentored by some of Australia’s leading contemporary graphic designers and companies.

    A group of those participants showing the highest commitment and engagement with this community project were identified by their mentors and also linked with work experience opportunities. Overall, the program aimed to assist the young unemployed participants to be job-ready with the key skills to succeed in business outside of their existing understanding of design and creativity.

    We offered a 2-week work experience placement within our Media Solutions Team for one of the program participants, Farhan. Farhan was a talented and motivated illustrator and designer but had no practical experience working in a corporate environment and limited exposure to the world of digital design. One of the major challenges faced by young people looking for work is this lack of practical experience. By shadowing our Media Solutions team for two weeks, Farhan was given an insight into their ways of working and an opportunity to work on real projects to real deadlines – invaluable experience for his resumé and in his search for employment.

    At the end of the program, Farhan reported increased confidence in his ability to find employment in graphic design and told us that his professional communication and team-working skills had improved. He is now working as a freelance graphic designer.

    “Thank you for the opportunities that you and your team have given to me. With the knowledge I have gained, I am now well equipped to face the New Year.” - Farhan, ABCN program participant

    MAKING INROADS

    DIGITAL CITIZENSHIP

    Students taking part in the Optus Digital Thumbprint Program

    INTERNET AND MOBILE APPLICATIONS HAVE BROUGHT HUGE BENEFITS TO US - ACCESS TO INFORMATION WHEN AND WHERE WE WANT IT, ENTERTAINMENT, LEARNING OR JUST KEEPING IN TOUCH.

    But with this also come the risks and pitfalls that children and young people are increasingly becoming vulnerable to – cyber bullying, device, social network or gaming addiction, loss of privacy and access to inappropriate content.

    We recognise this area as a material issue and strive to play a key role in educating customers and promoting cyber wellness and online safety among vulnerable children and youth.

    We look for opportunities to collaborate with like-minded partners in creating a safer cyber eco-system for our community and our customers.

    We launched a free program called Digital Thumbprint with secondary schools in New South Wales and Victoria, which offers three face-to-face workshops that educate and inform students in years 7-12 about cyber wellness, living safely online and getting the best out of the internet.

    Mobile phones, tablets and other electronic media provide young people with wonderful opportunities to socialise, network, learn and explore. Conversely, this broad access makes it difficult for parents to limit their children’s exposure to online content. We also recognised that children are struggling with digital reputation, cyber bullying, sexting and other cyber safety issues.

  • 4544 OUR COMMIUNITY / DIGITAL CITIZENSHIPOUR COMMIUNITY / DIGITAL CITIZENSHIP

    BACKING YOUNG SOCIAL ENTREPRENEURS We’re proud to be one of 6 key corporate partners of the Foundation for Young Australians’ (FYA) Innovation Nation-1000 ideas for a better Australia. This national campaign is aimed at engaging young people across the country to reveal their best ideas for building a better Australia.

    The top 2 ideas and their inventors will have the opportunity to secure $10,000 each in seed funding to turn their dream into a reality.

    We’re excited about how technology can improve young people’s future. We want to back our young people to develop ideas that help solve some of the major social issues their generation are facing such as cyber safety and bullying. Through Innovation Nation we’re hunting for 10 switched on digital citizens that have great ideas that align with our key focus areas such as making the net safer, positive and more productive experience for young people.

    We also opened up two positions for our people to represent us in Innovation Nation and ultimately pitch their idea to have a chance to win $10,000 of seed funding.

    Digital Thumbprint workshops cover topics to help young people understand their social media footprint including password security, safeguarding their online identity and cyber bullying. Importantly, the program aims to achieve genuine social impact through positive behaviour change of students in their online experiences.

    Over the past year 37, 821 students attended a Digital Thumbprint workshop with 95% of students confirming they learnt something in the workshop they can use in their everyday life. Furthermore, just over 97% of teachers feel their knowledge of digital concepts and their confidence to teach them, has increased as a direct result of the workshops.

    In 2014, industry recognised the Digital Thumbprint Program with the Communications Alliance and CommsDay Award for Community Contribution.

    “Digital Thumbprint’s evaluation results have demonstrated true social impact achieved to date.” - Change Labs, Digital Thumbprint Annual Report, 2014

    We’re growing our Digital Thumbprint program in 2015, taking the program to Queensland and creating a student ambassador program to increase further engagement and ongoing discussion about digital citizenship.

    SUPPORTING OUR KIDS Our partnership with Kids Helpline provides much needed intervention for primary aged children who are facing issues such as relationship and friendship problems, cyber bullying, family issues and fears about transitioning into high school. The program aligns with our inclusion and wellbeing strategy, and increasingly, the issues being raised and addressed through the helpline are related to staying safe online and cyber bullying.

    In June 2013, we worked with Kids Helpline to develop a new program “Kids Helpline @ School” aimed at primary school children. Kids Helpline @ School specifically focusses on education and prevention, particularly in relation to digital citizenship issues. Since the program’s implementation we’ve reached 11,207 students in 408 sessions across 146 schools mostly in Victoria and New South Wales.

    “Kids Helpline @ School has proven to be a very successful program not only in terms of exceeded levels of expected activity, but also in achieving improved knowledge, skills and attitudes in mental health and well-being related issues in helps seeking primary school aged children.” - Kids Helpline 2014 Progress Report

    Sessions are conducted using a range of digital technologies such as skype, google hangouts, FaceTime, and connected classrooms. Sessions entitled Bullying, Staying Safe Online, and Cyber bullying attracted a total of 2,767 students.

    Teachers themselves made substantial use of the educational materials available on the Kids Helpline@School micro-website, with 12,329 views of the landing page, 9,310 visits to the ‘bullying’ lesson resources and classroom activity pages and 2,426 hits to the pages related to safety online. Feedback has been extremely encouraging – almost 70 teachers have indicated they intend to book another session, and that they would recommend the program to other teachers or schools.

    We’re working with Kids Helpline to redesign an evaluation study to assess repeated and new impact measures, and to understand how the program is positively impacting children’s wellbeing and behaviours over time. This report will be available in December 2015.

    .

  • 4746 OUR COMMUNITY / INCLUSION & WELLBEINGOUR COMMUNITY / ENGAGING OUR PEOPLE

    Cure or to take part in an overseas volunteering program. Together, we contributed over $470,000 in this last financial year, which includes Workplace Giving, fundraising and Optus Matching.

    After the devastating impacts of Typhoon Haiyan in the Philippines, we sent five of our people to volunteer and help locals construct their new homes in the Province of Leyte. This was part of the Singtel Group Overseas volunteer Program, where our five volunteers joined colleagues from across the Singtel Group to help with the rebuild.

    We recognise that skilled volunteering is also an important part of how we add value to the community. One such

    program is ‘Limelight’, which leveraged the specific skills of our employees who are Lean Six Sigma professionals to support non-profit organisations. The Lean Six Sigma methodology is a managerial concept that improves processes and performance.

    This team is using its skills and expertise to provide community organisations with support to improve and focus greater attention on their core objectives. They’ve developed the ‘Limelight’ pathway to help organisations identify and solve problems, deliver value to customers and drive continuous improvement.

    This year five community organisations participated in Limelight: The Kid’s Cancer Project, The Smith Family, Big Brother Big Sister, Conservation Volunteers Australia and The Australian Red Cross.

    AN IMPORTANT PART OF OUR INCLUSION & WELLBEING STRATEGY IS OUR ‘YES’ OPTUS COMMUNITY GRANTS PROGRAM. WE’VE BEEN SUPPORTING ORGANISATIONS THAT HELP VULNERABLE YOUNG AUSTRALIANS ACROSS THESE AREAS SINCE 2008.

    So far, 237 grants have been given out, and almost $1.5 million has been donated. We’re really inspired by the work that takes place across Australia and extremely proud to be creating positive change in the lives of Australians and bringing technology and innovation to those who can benefit from it the most. This year we received more than 650 applications for our Optus Community Grants and 34 awesome not-for-profit organisations were rewarded a grant up to $10,000.

    11 of the 34 grants distributed in FY15 were focused in the category of Inclusion & Wellbeing. We fund projects which help to improve young people’s mental wellbeing and health as well as increase opportunities and accessibility for young

    ENGAGING OUR PEOPLE IN THE COMMUNITY IS ONE WAY WE MAKE OPTUS A GREAT PLACE TO WORK. OUR PEOPLE CAN SUPPORT THEIR FAVOURITE CHARITIES THROUGH YES4GOOD – A ONE STOP SHOP FOR GIVING.

    yes4Good allows our people to look for and participate in skilled or non-skilled volunteer opportunities, sign up to workplace giving and fundraise for a cause close to their heart. The website offers a choice of over 250 charities, so there is no problem finding a fantastic cause where our people can help make a difference.

    1,379 volunteering roles were filled this year where our people gave their time through volunteering to support either their favourite charity, an ABCN mentoring program, Limelight, Tour de

    WE RECOGNISED THAT SKILLED

    VOLUNTEERING IS ALSO AN

    IMPORTANT PART OF HOW WE ADD VALUE TO THE COMMUNITY

    ENGAGING OUR PEOPLE INCLUSION & WELLBEING

    Optus people promoting charities at Optus Campus Sydney

    people in isolated and remote areas to ensure they have access to services.

    One such grant was giving special needs students at Cobram and District Special School a boost to their health and wellbeing via the Bluearth Active Schools program. Bluearth Active Kids delivers structured fitness plans specially tailored for children with special needs to show them how to incorporate exercise into their daily routines and lead an active lifestyle. Using a Jawbone Up, a wearable health-tracking device and an accompanying iPad purchased with the grant, students are taught how to monitor and map their progress and take an active role in maintaining their health and fitness, decreasing their chances of developing health issues in the future.

    We’re also committed to creating opportunities for indigenous people in our community. However, we recognised that direct regional employment opportunities were limited - so we partnered with the specialist

    organisation Diversity Dimensions. Their Retail Ready Program aims to provide young indigenous Australians with the skills and opportunity to apply for work in the retail sector.

    Diversity Dimensions identified Kempsey, NSW as an area of high indigenous population and the local supermarket retailer Woolworths, who were ready to accept merit appropriate graduates of our sponsored training program.

    11 indigenous students from Melville High School, Kempsey and Macleay Vocational College took part in a three day program in early September, designed to address any equal opportunities concerns and handle any barriers to success

    For many students this was their first experience of applying for jobs and attending a work experience placement. 10 of the 11 students taking part successfully completed the program - and a number of casual positions were offered for the upcoming holiday period.

  • 4948 OUR COMMUNITY / LOOKING AHEADOUR COMMUNITY / INCLUSION & WELLBEING

    Another program we supported is the Miriwoong Language Centre at the Kununurra Early Learning Centre. The Miriwoong Language Nest is a culturally responsive education program that centres on native language immersion and is regularly delivered to more than 200 children each week.

    Plans for the future of the Miriwoong Dawang Woorlab-gerring Language and Culture Centre include the purchase of audio readers for students with $9,500 from this year’s Optus Community Grants program. The readers will help digitise and distribute the learning materials to more than 200 children and their families.

    To support digital inclusion across the non-for-profit sector, we signed a five-year agreement with Church Resources to deliver a large range of telephony and data services. Church Resources, a provider of aggregated procurement services to almost 20,000 not-for-profit members, will be able to procure its members’ mobile and fixed line offers at highly competitive rates, including voice, mobile and data services.

    This partnership gives us an opportunity to deliver quality solutions and great value telecommunications to the Church, not-for-profit, health and education sectors as they increasingly adopt digital technology to drive productivity and member benefits.

    Engaging our people is central to our work in the community. We extended our Community Grants program to

    LOOKING AHEAD FOR OUR COMMUNITY

    EXPAND OUR FLAGSHIP DIGITAL THUMBPRINT SCHOOL PROGRAM in Queensla